In this much heralded treatise which, happily, is still on the reading list in most college economics classes, Smith sets forth an explanation and defense of the principles of capitalism. The problem is that although Smith is taught, he is often disparaged by those who teach him.
Richard Nixon was right when he opined that most historians and history professors tend to be leftists. His assessment also holds true for economists and economics professors. For every Milton Friedman or Arthur Laffer, two economists on whom Ronald Reagan leaned, there are probably 50 economists or professors who are disciples of John Maynard Keynes. Keynes, an Englishman, was Adam Smith’s 20th century philosophical opposite.
In America, there is a growing number of socialists. One reason for this is all the professors. Another is the government’s persistent extension of socialism to its citizens. Who doesn’t like free stuff? Free stuff like tickets and trinkets probably doesn’t change our character or our outlook, but free medical care, free food and free education can and do. Of course it’s not really free. Somebody pays.
Trivial free stuff is one thing, but serious free stuff on a large scale is another. Handouts from the government can, among other things, turn us into socialists. We like them, we get used to them and we become dependent. That’s what Adam Smith didn’t like and what John Maynard Keynes didn’t mind. As the cover of Newsweek Magazine blared, just after President Obama signed his Obamacare bill, “We’re all socialists now!”
The big question for us and our lawmakers should be: Is our newfound socialism sustainable? It certainly isn’t foundational. We didn’t start out with and didn’t build our nation with government giveaway programs, but with a rugged individualism that fostered personal liberty and hard work.
Prolonged socialism, or any other type of statist system, almost always leads to revolution. It’s amazing that the socialist Soviet Union lasted 75 years, given its failure to produce enough groceries. But for the intelligence of Mikhail Gorbachev — Margaret Thatcher’s “a man I can do business with” — the Soviet Union would have remained a struggling, socialist state. As things turned out, Gorbachev, a reader and a student of history, discerned that socialism was not feeding the Soviet people and never would.
Socialism has a reputation for not producing enough groceries. What produces groceries is Smith’s idea of a free citizen growing food in his privately owned field and selling it to a willing buyer. Another free citizen down the road does the same thing. Buyers of food will go to the citizen whose product and price they like. Competition will incline the two sellers to improve their product and their price. Such unfettered economic practice of free people Adam Smith referred to as “the Invisible Hand.”
Socialists reject this arrangement purely because it sometimes makes sellers rich. They reject Smith’s notion of enlightened self-interest, believing that no producer-seller could ever care about the poor. They abhor the word “profit,” and argue for the nebulous goal of “fairness.” Believing that one man’s gain is another man’s loss, they argue that after making a prescribed amount of money, a seller should go teach, do social work or become a community organizer — to organize, of course, against sellers who have done well.
Why it’s considered inappropriate to label the Obama administration socialist is a puzzlement. If it quacks like a duck, waddles like a duck …
Essentially, the Obama administration consists of academics who have never planted a field and sold food, never built a garage and repaired cars, never bought a restaurant and labored endlessly and never started a company that provided livelihoods for others. What they have done, because of their mindset and darkened understanding, is impose rules and regulations upon those who have planted, labored and built.
Socialism’s end is shared poverty. It is the refuge of non-producers, the pipe dream of intellectuals, the enemy of individual initiative. If this is what Americans wish for, we can obviously have it. If it isn’t, a new president and a new Congress are necessary.
Not so incidentally, the full title of Adam Smith’s work was “An Inquiry into the Nature and Causes of the Wealth of Nations.” It was not propaganda for capitalists, but a sincere examination by a humble professor of moral philosophy who desired that all people prosper. It was first published in 1776 and was embraced by a brave and honorable group of nation builders 3,000 miles away from Smith’s native Scotland.
Roger Hines of Kennesaw is a retired high school teacher and former state legislator.